Business leaders have welcomed the tone and long-term goals of the Chancellor’s Autumn Statement but have expressed concern over immediate lack of detail in critical areas.
In the budget plan outlined in Parliament on Thursday, Jeremy Hunt announced around £55 billion in tax rises and spending cuts.
There was a freeze on income tax thresholds, a rise in the average household energy bill cap from £2,500 to £3,000 and confirmation that pensions and benefits would rise in line with inflation.
He also announced that the National Living Wage would rise from £9.50 an hour to £10.42 for over 23s from April, that the Windfall Tax levied on energy firms would rise from 25 per cent to 35 per cent and outlined business rate cuts that, he said, would benefit 700,000 companies.
Staffordshire Chambers of Commerce Chief Executive Sara Williams, pictured above, said: “This budget statement has good elements but is lacking in key details in areas that the business community really needs clarity on right now.
“Businesses clearly welcome the sentiment about financial stability, investment in public services and targeting help at the most vulnerable in society.
“It is also encouraging that this is a proper budget which has been tested, costed and checked by the Office for Budget Responsibility. Compared to some of its recent predecessors it is a vast improvement.
“But there are also certain worrying elements that will not improve business confidence.
“For instance, the national living wage increase by 10 per cent.
“Obviously it is right that there is a push to increase the financial wellbeing of everyone in employment, but this move will have knock-on consequences for companies, many of whom will have to boost salaries to meet this rise.
“This, in turn could have a knock-on effect on inflation, which is already at a 40 year high.”
Sara also criticised the lack of clarification from the Chancellor, pictured above, on help for businesses with their energy costs.
“We expected more to be announced by the Chancellor than ‘we are still looking at it’,” she said.
“This is a particular concern in Staffordshire where we have many energy-intensive businesses – such as our pottery and engineering companies. It is very difficult for them to plan with any certainty when any decision on this is pushed further into the future.”
Sara also said that an announced reduction on dividend allowances could adversely affect entrepreneurs and small firms, and that the Windfall Tax rise to 35 per cent would have been “expected” by the energy companies.
She also said she was pleased over confirmation that the HS2 project would not be cut further.
She said: “The Chamber is a real advocate for this project and the prosperity and growth it can bring to the area. With this confirmation we can work with businesses and other organisations to maximise the opportunities that come from it.”
Sara has now called on the government to put more meat on the bones regarding its plans over the coming week and months.
She said: “As well as needing more clarification over energy price help for businesses, we also want the Government to tell us more about how they are getting to grips with international trade agreements because export-led growth is so important to our future economic prosperity as a country.
“The statement was also very light on green innovation plans and we need more details about these so that businesses can have more confidence about investing in new energy technology and infrastructure.”
CBI Chief Economist Rain Newton-Smith echoed the call for more clarity in certain areas and said the statement was a mixed bag for business. She said: “The test for the autumn statement was to deliver stability at the same time as unveiling a clear plan for growth.
“The Chancellor deserves credit for delivering stability, as well as protecting the most vulnerable, but businesses will think there’s more to be done on growth.
“Backing the CBI’s call for a freeze in business rates and smoothing the increase for those facing higher bills is very welcome.”
She added: “But stabilising public finances inevitably means difficult decisions have to be taken. Businesses will view a freeze in NICs thresholds and further windfall taxes as the sharpest stings in the tail.
“Firms will also need more detail on what happens with the business energy support scheme in the coming weeks.”